Thursday, May 16, 2013

TTB Issues Industry Circular on Social Media Advertising

The TTB has issued a new Industry Circular outlining the guidelines for social media advertising by wineries, breweries and distilleries. This includes Facebook, Twitter, You Tube, Mobile Apps, and Blogs. The industry circular can be viewed by following this link:

The TTB doesn’t merely collect your taxes and approved
your labels, they also regulate advertising for alcoholic beverages.
Now your advertisements do not need to be approved by the TTB, but they
must be complaint with the regulations and it is up to the winery or
“responsible advertiser” to make sure the advertisements are complaint.

Let’s examine what is considered by TTB to be an advertisement. According to TTB:

The regulations define the term”advertisement” as any written or
verbal statement, illustration, or depiction which is in, or calculated
to induce sales in, interstate or foreign commerce, or is disseminated
by mail. Examples include ads in newspapers or magazines, trade
booklets, menus, wine cards, leaflets, circulars, mailers, book inserts,
catalogs, promotional materials, or sales pamphlets. The definition
includes any written, printed, graphic, or other material accompanying
the container; markings on cases, billboards, signs, or other outdoor
display; and broadcasts made via radio, television, or in any other
media. Though not specifically listed, this definition includes website
and other Internet-based advertising.

That last sentence is very important. The regulations for labeling
and advertising of wine have not been updated for quite some time, and
they were originally written before the Internet became what it is
today. So the TTB places Internet advertising under the “any other
media” umbrella. The TTB considers Facebook and other social media
sites to be advertising. Required InformationThere
is some required information for advertising material. They are
listed in the regulations (27 CFR Part 4.62) as the following:

Responsible advertiser. The advertisement shall state the
name and address of the permittee responsible for its publication or
broadcast. Street number and name may be omitted in the address.

Class, type, and distinctive designation. The
advertisement shall contain a conspicuous statement of the class,
type, or distinctive designation to which the product belongs,
corresponding with the statement of class, type, or distinctive
designation which is required to appear on the label of the product.

Exception. (1) If an advertisement refers to a general wine
line or all of the wine products of one company, whether by the company
name or by the brand name common to all the wine in the line, the
only mandatory information necessary is the name and address of the
responsible advertiser. This exception does not apply
where only one type of wine is marketed under the specific brand name
advertised. (2) On consumer specialty items, the only information
necessary is the company name or brand name of the product.

Prohibited InformationAs with wine label, there are
prohibited practices for wine advertising. The regulations (27 CFR
Part 4.64) list them as the following.

Any statement that is false or untrue in any material particular,
or that, irrespective of falsity, directly, or by ambiguity, omission,
or inference, or by the addition of irrelevant, scientific or
technical matter tends to create a misleading impression.

Any statement that is disparaging of a competitor’s products.

Any statement, design, device, or representation which is obscene or indecent.

Any statement, design, device, or representation of or relating to
analyses, standards, or tests, irrespective of falsity, which the
appropriate TTB officer finds to be likely to mislead the consumer.

Any statement, design, device, or representation of or relating to
any guarantee, irrespective of falsity, which the appropriate TTB
officer finds to be likely to mislead the consumer. Money-back
guarantees are not prohibited.

Any statement that the wine is produced, blended, bottled, packed,
or sold under, or in accordance with, any municipal, State, or Federal
Government authorization, law, or regulations; and if a municipal,
State, or Federal permit number is stated, the permit number shall not
be accompanied by any additional statement relating thereto.

Any statement of bonded winecellar and bonded winery numbers unless
stated in direct conjunction with the name and address of the person
operating such winery or storeroom. Statement of bonded winecellar and
bonded winery numbers may be made in the following form: “Bonded
Winecellar No. __,” “Bonded Winery No. __,” “B. W. C. No. __,” “B. W.
No. __.” No additional reference thereto shall be made, nor shall any
use be made of such statement that may convey the impression that the
wine has been made or matured under Government supervision or in
accordance with Government specifications or standards.

Any statement, design, device, or representation which relates to
alcohol content or which tends to create the impression that a wine
contains distilled spirits, is comparable to a distilled spirit, or has
intoxicating qualities.

Any word in the brand name or class and type designation which is
the name of a distilled spirits product or which simulates, imitates,
or creates the impression that the wine so labeled is, or is similar
to, any product customarily made with a distilled spirits base.

Additionally, wine advertising may not include information that is
deemed be inconsistent with labeling. Any label depicted on a bottle in
an advertisement shall be a reproduction of an approved label.Further restricted items on wine advertisements are:

Statement of age. No statement of age or representation
relative to age (including words or devices in any brand name or mark)
shall be made, except (1) for vintage wine, in accordance with the
provisions of §4.27; (2) references in accordance with §4.38(f); or (3)
use of the word “old” as part of a brand name.

Statement of bottling dates. The statement of any bottling
date shall not be deemed to be a representation relative to age, if
such statement appears without undue emphasis in the following form:
“Bottled in __” (inserting the year in which the wine was bottled).

Statement of miscellaneous dates. No date, except with
respect to statement of vintage year and bottling date, shall be stated
unless, in addition thereto, and in direct conjunction therewith, in
the same size and kind of printing there shall be stated an
explanation of the significance of such date: Provided, That if
any date refers to the date of establishment of any business, such
date shall be stated without undue emphasis and in direct conjunction
with the name of the person to whom it refers.

Flags, seals, coats of arms, crests, and other insignia. No
advertisement shall contain any statement, design, device, or pictorial
representation of or relating to, or capable of being construed as
relating to, the armed forces of the United States, or of the American
flag, or of any emblem, seal, insignia, or decoration associated with
such flag or armed forces; nor shall any advertisement contain any
statement, device, design, or pictorial representation of or concerning
any flag, seal, coat of arms, crest, or other insignia likely to
mislead the consumer to believe that the product has been endorsed,
made, or used by, or produced for, or under the supervision of, or in
accordance with the specifications of the government, organization,
family, or individual with whom such flag, seal, coat of arms, crests,
or insignia is associated.

Statements indicative of origin. No statement, design,
device, or representation which tends to create the impression that the
wine originated in a particular place or region, shall appear in any
advertisement unless the label of the advertised product bears an
appellation of origin, and such appellation of origin appears in the
advertisement in direct conjunction with the class and type designation.

Use of the word “importer” or similar words. The word importer or
similar words shall not appear in advertisements of domestic wine
except as part of the bona fide name of the permittee by or for whom, or
of a retailer for whom, such wine is bottled, packed or distributed: Provided, That
in all cases where such words are used as part of such name, there
shall be stated the words “Product of the United States” or similar
words to negate any impression that the product is imported, and such
negating statements shall appear in the same size and kind of printing
as such name.

Confusion of brands. Two or more different brands or lots of
wine shall not be advertised in one advertisement (or in two or more
advertisements in one issue of a periodical or newspaper, or in one
piece of other written, printed, or graphic matter) if the advertisement
tends to create the impression that representations made as to one
brand or lot apply to the other or others, and if as to such latter the
representations contravene any provision of §§4.60 through 4.64 or are
in any respect untrue.

Deceptive advertising techniques. Subliminal or similar
techniques are prohibited. “Subliminal or similar techniques,” as used
in this part, refers to any device or technique that is used to convey,
or attempts to convey, a message to a person by means of images or
sounds of a very brief nature that cannot be perceived at a normal level
of awareness.

Health-related statements:

Health-related statement means any statement related to health and
includes statements of a curative or therapeutic nature that,
expressly or by implication, suggest a relationship between the
consumption of alcohol, wine, or any substance found within the wine,
and health benefits or effects on health. The term includes both
specific health claims and general references to alleged health
benefits or effects on health associated with the consumption of
alcohol, wine, or any substance found within the wine, as well as
health-related directional statements. The term also includes
statements and claims that imply that a physical or psychological
sensation results from consuming the wine, as well as statements and
claims of nutritional value ( e.g., statements of vitamin
content). Statements concerning caloric, carbohydrate, protein, and
fat content do not constitute nutritional claims about the product.

Specific health claim is a type of health-related statement that,
expressly or by implication, characterizes the relationship of the
wine, alcohol, or any substance found within the wine, to a disease or
health-related condition. Implied specific health claims include
statements, symbols, vignettes, or other forms of communication that
suggest, within the context in which they are presented, that a
relationship exists between wine, alcohol, or any substance found within
the wine, and a disease or health-related condition.

Health-related directional statement is a type of
health-related statement that directs or refers consumers to a third
party or other source for information regarding the effects on health
of wine or alcohol consumption.

Rules for advertising

Health-related statements. In general, advertisements may
not contain any health-related statement that is untrue in any
particular or tends to create a misleading impression as to the effects
on health of alcohol consumption. TTB will evaluate such statements
on a case-by-case basis and may require as part of the health-related
statement a disclaimer or some other qualifying statement to dispel
any misleading impression conveyed by the health-related statement.
Such disclaimer or other qualifying statement must appear as prominent
as the health-related statement.

Specific health claims. A specific health claim will not be
considered misleading if it is truthful and adequately substantiated by
scientific or medical evidence; sufficiently detailed and qualified
with respect to the categories of individuals to whom the claim
applies; adequately discloses the health risks associated with both
moderate and heavier levels of alcohol consumption; and outlines the
categories of individuals for whom any levels of alcohol consumption
may cause health risks. This information must appear as part of the
specific health claim and in a manner as prominent as the specific
health claim.

Health-related directional statements. A statement that
directs consumers to a third party or other source for information
regarding the effects on health of wine or alcohol consumption is
presumed misleading unless it: Directs consumers in a neutral or other
non-misleading manner to a third party or other source for balanced
information regarding the effects on health of wine or alcohol
consumption; and includes as part of the health-related directional
statement, and in a manner as prominent as the health-related
directional statement, the following disclaimer: “This statement should
not encourage you to drink or increase your alcohol consumption for
health reasons;” orincludes as part of the health-related
directional statement, and in a manner as prominent as the
health-related directional statement, some other qualifying statement
that the appropriate TTB officer finds is sufficient to dispel any
misleading impression conveyed by the health-related directional
statement.

It is clear that the TTB has an extensive list of prohibited
practices for advertising of wine (and other alcoholic beverages) but it
is consistent with the prohibited practices on wine labels. If you
have any questions about anything listed in this blog post please let us
know and we will clarify them further for you. It is essential for
wineries to be compliant with TTB advertising regulations.